Texas Instruments 2012 Annual Report Download - page 26

ANNUAL
REPORT
TEXAS INSTRUMENTS24 • 2012 ANNUAL REPORT
The addition to Analog goodwill in 2011 was from the National acquisition. We also recognized other intangible assets associated with
this acquisition of $2.96 billion, primarily for developed technology and customer relationships. In 2012, we had no additional intangible
assets from an acquisition. The components of acquisition-related intangible assets as of December 31, 2012 and 2011, are as follows:
December 31, 2012 December 31, 2011
Amortization
Period
(Years)
Gross
Carrying
Amount Accumulated Amortization Net
Gross
Carrying
Amount Accumulated Amortization Net
Acquisition-related intangibles:
Developed technology . . . . . . . . . . . . . . . 4- 10 $2,145 $312 $1,833 $ 2,089 $ 91 $ 1,998
Customer relationships . . . . . . . . . . . . . . . 5 - 8 821 137 684 822 34 788
Other intangibles . . . . . . . . . . . . . . . . . 2 - 7 46 36 10 50 29 21
In-process R&D . . . . . . . . . . . . . . . . . . (a) 31 n/a 31 93 n/a 93
Total . . . . . . . . . . . . . . . . . . . . . . . . . . $3,043 $485 $2,558 $ 3,054 $ 154 $ 2,900
(a) In-process R&D is not amortized until the associated project has been completed. Alternatively, if the associated project is
determined not to be viable, it will be expensed.
Amortization of acquisition-related intangibles was $342 million, $111 million and $48 million for 2012, 2011 and 2010, respectively,
primarily related to developed technology. Amortization expenses related to the National acquisition were $325 million and $87 million
for 2012 and 2011, respectively. Future estimated amortization of acquisition-related intangibles for the years ended December 31 is
as follows:
2013 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 335
2014 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 321
2015 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 319
2016 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 319
2017 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 318
Thereafter . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 946
11. Postretirement benefit plans
Plan descriptions
We have various employee retirement plans including defined benefit, defined contribution and retiree health care benefit plans. For
qualifying employees, we offer deferred compensation arrangements. As a part of the National acquisition, we assumed the assets and
liabilities of its defined benefit plans, primarily those associated with the United Kingdom and Germany.
U.S. retirement plans:
Our principal retirement plans in the U.S. are qualified and non-qualified defined benefit pension plans (all of which were closed to new
participants after November 1997), a defined contribution plan and an enhanced defined contribution plan. The defined benefit pension
plans include employees still accruing benefits as well as employees and participants who no longer accrue service-related benefits, but
instead, may participate in the enhanced defined contribution plan.
Both defined contribution plans offer an employer-matching savings option that allows employees to make pre-tax contributions to
various investment choices, including a TI common stock fund. Employees who elected to continue accruing a benefit in the qualified
defined benefit pension plans may also participate in the defined contribution plan, where employer-matching contributions are
provided for up to 2 percent of the employee’s annual eligible earnings. Employees who elected not to continue accruing a benefit in
the defined benefit pension plans, and employees hired after November 1997 and through December 31, 2003, may participate in the
enhanced defined contribution plan. This plan provides for a fixed employer contribution of 2 percent of the employee’s annual eligible
earnings, plus an employer-matching contribution of up to 4 percent of the employee’s annual eligible earnings. Employees hired after
December 31, 2003, do not receive the fixed employer contribution of 2 percent of the employee’s annual eligible earnings.
At December 31, 2012 and 2011, as a result of employees’ elections, TI’s U.S. defined contribution plans held shares of TI common
stock totaling 20 million shares and 22 million shares valued at $610 million and $639 million, respectively. Dividends paid on these
shares for 2012 and 2011 were $16 million and $13 million, respectively.
Our aggregate expense for the U.S. defined contribution plans was $70 million in 2012, $55 million in 2011 and $50 million in 2010.